Which of the following are related to tax-evasion? a. Claiming bogus expenses and losses. b. Hiding…
Tax evasion is the illegal and fraudulent suppression or misrepresentation of facts to evade tax liability, which includes claiming bogus/fictitious expenses and losses (a),…
Choose your answer
Which of the following are related to tax-evasion?
a. Claiming bogus expenses and losses.
b. Hiding capital nature of profits.
c. Showing sales transactions.
d. Showing excess transactions.
e. Showing real income and expenses.
Answer and explanation
Correct answer B
Tax evasion is the illegal and fraudulent suppression or misrepresentation of facts to evade tax liability, which includes claiming bogus/fictitious expenses and losses (a), disguising taxable revenue profits as capital nature receipts/profits (b), and inflating or fabricating excess purchase/expense transactions (d). Showing genuine sales and real income/expenses (c and e) represents honest tax compliance.
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UGC NET Commerce